PRACTICAL & LEGAL PROTECTION OF
COMPUTER DATABASES

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Article on Computer Databases Originally Published in the Florida Bar Journal in 1991 and updated in 1996. This article has not been updated since 1996, and so is obviously out of date. Still, I keep the article online because it contains good general background information on database law that may help attorneys and IT professionals to get started in this area.

This article discusses both practical and legal methods of protecting a computer database from
unauthorized copying and use. The intentional use of "seeds" and "signatures" in a database, when
combined with the three main vehicles of legal protection: copyright, trade secrets and contract;
can create a powerful defense against the "computer pirate."

The computer database is a new type of intellectual property of growing importance in today's
world. Essentially it is a collection of information stored so that it can be selectively searched and
the desired information retrieved using a computer. Pearson, Computer Databases: Copyright
and Other Protection, in The Law and Business of Computer Software § 22.02 (D.C. Toedt
ed. 1990). As society moves further into the informational age the significance and dollar volume
of database products should increase. Since this is a relatively new type of property, American
law is having to rapidly evolve and create new standards and legal principles to try and protect
against its misuse and theft.

Databases have long existed in manual or book form. Contemporary examples of manual
databases still abound, such as the phone book and many reference books, including legal
reporters. The computer database is essentially an information compendium like a phone book
which has been placed in a computer and thereby automated. When information is computerized,
however, there are many more ways for the information to be accessed, manipulated and used;
the value of the database to users is thereby greatly enhanced. Some popular examples of
computer databases include legal databases such as Westlaw and Lexis, and various business and
scientific databases such as those found on Dialog and Inter-Net.

The United States Copyright Office in its publication Circular 65: Copyright Registration for
Automated Databases defines an automated database as, "a body of facts, data, or other
information assembled into an organized format suitable for use in a computer and comprising one
or more files." The federal Copyright statutes do not yet specifically list automated databases as a
copyrightable subject matter. 17 U.S.C. § 101, § 102. Nevertheless, the Copyright Office
follows case law and allows a computer database to be copyrighted as a literary work, even
though they are not specifically included in the statutes. See, e.g., Lane v. First Nat. Bank of
Boston, 687 F.Supp. 11 (D.C. Mass. 1988).

The Copyright Office considers a computer database to be copyrightable as a "compilation". The
law defines compilation as a work:

[F]ormed by the collection and assembling of preexisting materials or of data that are
selected, coordinated or arranged in such a way that the resulting work as a whole
constitutes an original work of authorship.

17 U.S.C. § 101. Federal copyright law extends copyright protection to compilations as a form of
literary work. 17 U.S.C. § 103. In addition to computer databases, a compilation can be a
collective work such as a periodical, anthology and encyclopedia, or a reference work such as a
directory, index, map, telephone book, guide book, law reporter, catalog, chart, or racing guide.

The "literary work" in a computer database which may be protected is composed of four parts:
(1) selection of the contents; (2) the coordination of the contents internally; (3) the arrangement of
all of all elements of the database; and, (4) the contents itself. L. Kutten, Computer Software, §
2.08A(2)(c)(i), (1990). The copyright of a compilation may extend to one of these parts without
including the others.

Under traditional concepts of literary copyright, the data contained in a compilation (part four),
and the selection of the data (part one), may sometimes not be protected from copying. Only the
coordination and arrangement of the database may be protected, and even then there must be
some originality to the collection and arrangement for it to be protected. See, e.g., 17 U.S.C.A. §
103 and cases cited therein. When a database is composed of facts, these facts frequently cannot
be copyrighted, for otherwise the public's right to use information in the public domain would be
unreasonably limited. A recent case involving baseball pitcher statistics sheds an interesting light on
this issue. Kregos v. Associated Press, 731 F.Supp. 113, 117 (S.D.N.Y. 1990), partiallyrev'd
on other grounds, 937 F.2d. 700 (2d. Cir. 1991), on remand 795 F.Supp. 1325, (S.D.N.Y.
1991), aff'd, 3 F.3d. 656 (2d. Cir. 1993). District Judge Goettel's colorful introductory remarks on remand are a sad, but true, commentary on our over litigious society.

The basic problem in protecting a database is that the information compiled is frequently public
knowledge, just facts, or the data is otherwise not susceptible of ownership by the compiler of the
database. For example, a person could call every attorney in the country and ask if they
specialized in computer law. The names and addresses of those who said yes could then be put
into a database of computer lawyers. Does the preparer of this database own the names and
addresses of these attorneys? The attorneys involved would certainly deny this, so what does the
preparer of this database own? What can he keep another from copying and selling as his own?
The way the information about attorneys is arranged in the database might involve little or no
originality and, thus, even this aspect of the database might not be protectable. For instance, it
might be a simple alphabetical list. The person who has gone to the time and trouble to call all of
the attorneys in the country and cull this information wants to be able to prevent someone from
simply taking this information from him. If someone is going to compete with him and sell a rival
list of computer lawyers, then the first person would want his competitor to go to the same time,
effort and expense that he did to come up with these names.

Since the names and addresses of the attorneys are not susceptible to ownership, a competitor
certainly could call up all of the attorneys in the country and, assuming he got the same answers,
come up with the same list. This would unquestionably be fair competition, and the first person
who thought of the idea of compiling a list of computer attorneys would not be able to stop it. Mazer v. Stein, 347 U.S. 201, 74 S.Ct. 460, 98 L.Ed 630 (1954) (distinguishes copyrights from
patents and holds that copyright protects particular expressions of ideas, but not the ideas
themselves). As we will see, in some circumstances a would be competitor might also be able to
simply take the information compiled by the first pioneer at great expense and trouble, and this
taking would be perfectly legal. Protection of raw data is legally tricky, and the first pioneer can
frequently lose out if they are not careful.

There are essentially three ways to legally protect computer databases: copyright, trade secret and
contract. Ideally, all three of these legal means can be employed, along with practical non-legal
methods, to provide the maximum protection against the piracy of a database program. There are,
of course, other legal theories that could be argued in a law suit to protect databases, such as
unfair competition and conversion; however, these theories may be preempted by copyright law. SeeSouthern Bell Tel. & Tel. v. Associated Telephone Directory Publishers, 756 F.2d 801,
810 n. 9 (11th Cir., 1985) (unfair competition); Pearson, supra, at § 22.07 (misappropriation
theories and preemption). Copyright law provides the framework and basic foundation for legal
protection. It is, therefore, discussed first.

Copyright law originates in Article 1, § 8 of the Constitution of the United States which says that
Congress shall have the power:

To promote the Progress of Science and useful Arts, by securing for limited Times to
Authors and Inventors the exclusive Right in their respective Writings and Discoveries.

To implement this constitutional right Congress enacted copyright and patent laws. The copyright
law was written to protect "original works of authorship." 17 U.S.C. § 102. Annotation, Supreme
Court's Views as to When Books or Other Written or Printed Materials are Copyrightable
Under Federal Law, 113 L.Ed.2d. 771 (1991).

Over the centuries Courts have examined whether or not a work has "originality" to determine
if it may receive copyright protection. Kamar Int'l v. Russ Berrie & Co., 657 F.2d 1059, 1061
(9th Cir. 1981) (originality is the sine qua non of copyrightability). Originality requires an author to
contribute something more than a "merely trivial" variation which is recognizably "his own." Id.
Under traditional copyright doctrine a work must show some "creativity" in order to meet the
originality test, and it is not subject to copyright if the work merely copies an existing work. SeeCopyright Protection For Citations To A Law Reporter, Intellectual Property Law Review,
at 444-56, (Norris ed., 1988).

This essential element of "creativity" is weak or completely absent in many manual reference
works or computer databases. For example, what creativity is there in an alphabetical listing of
names in a phone book?

Another basic problem in protecting a database is that copyright law does not prohibit the copying
of facts, even newly discovered or expensively acquired facts, nor does it prohibit the copying of
ideas. Harper & Row, Publishers, Inc. v. Nation Enterprises, 471 U.S. 539, 556, 105 S.Ct.
2218, 85 L.Ed.2d. 588 (1985); Kregos v. Associated Press, 937 F.2d 700, 703-10 (2nd Cir.,
1991); Mazer v. Stein, 347 U.S. 201, 74 S.Ct. 460, 98 L.Ed. 630 (1954). Copyright law can
only provide protection to the arrangement and coordination of facts in a database. Even then,
there must be some originality to the collection and arrangement for it to be protected. See, e.g.,
17 U.S.C.A. § 103 and cases cited therein.

Typically the preparation of a database requires a significant expenditure of time, effort and money
to cull and select information from many different sources, but little or no original creativity to
express the facts, or arrange them. In these circumstances, where the compiler gathers and
compiles raw facts, he did not create the facts, he just discovered or uncovered them, sometimes
at great expense and trouble. Such was the case in our earlier example of the poor investigator
who had to call every attorney in the country to see if they practiced computer law. So how can
you prevent copying of the work?

Under the sweat of the brow doctrine, copyright could prevent the unauthorized copying of facts
in a database, if the compiler could show that sufficient effort went into the acquisition and
selection of the data to make it original. The protection would lie even if the information compiled
was public knowledge or otherwise not protected. Southern Bell Tel. & Tel., 756 F.2d at 810.

Other Courts, however, continued to analyze a database dispute by using traditional concepts of
creativity, and criticized the "sweat of the brow" standard. Miller v. Universal City Studios,
Inc., 650 F.2d 1365, 1369 (5th Cir. 1981); Lane v. First Nat. Bank of Boston, 687 F.Supp.
(D.C. Mass. 1988). In the words of the Second Circuit Court of Appeals:

To grant copyright protection based merely on the "sweat of the author's brow" would risk
putting large areas of actual research material off limits and threaten the public's
unrestrained access to information.

In Feist the compilation was manual, it was the phone book, for which the phone company had
made a valid copyright registration. The alleged infringer, Feist Publications, was found to have
copied large portions of the white pages from Rural Telephone Services Companies phone book.
Feist Publication's repetition of four fictitious listings, or seeds, which Rural Telephone had planted
in their white pages helped to prove the copying. Feist Publications included the names and
addresses from Rural Telephone's white pages in its competing phone books. Rural Telephone
argued that the white pages listing of names and addresses in its phone book, although admittedly
facts, was still entitled to copyright protection. It contended that its efforts to obtain and select
these facts should be protected, and that its competitor, Feist Publications, should be required to
go to the same effort to obtain the information, and should not be allowed to benefit from its
research and just copy the information. Feist Publications, 499 U.S. at. 343-44.

The 'sweat of the brow' doctrine had numerous flaws, the most glaring being that it
extended copyright protection in a compilation beyond selection and arrangement - the
compiler's original contribution - to the facts themselves. . . 'Sweat of the brow' courts
thereby eschewed the most fundamental axiom of copyright law - that no one may
copyright facts or ideas. . .[T]hey handed out proprietary interests in facts and declared
that authors are absolutely precluded from saving time and effort by relying on facts
contained in prior works.

The Supreme Court held that the white pages portion of the phone book was not entitled to
copyright protection, even though the rest of the book was. Therefore, Feist Publications, and
anyone else, was free to copy the white pages. As Justice O'Connor concluded in her unanimous
opinion:

Because Rural's white pages lack the requisite originality, Feist's use of the listings cannot
constitute infringement. This decision should not be construed as demeaning Rural's efforts
in compiling its directory, but rather as making clear that copyright rewards originality, not
effort.

Now that the sweat of the brow doctrine is dead, it is clear that raw facts in a database may not
be protected by copyright, regardless of the time or expense that went into locating them. Still, in
many databases the data itself, or the particular expressions of the facts, may have been created
by the author. In such cases the data has originality and can be protected. An example of this
which is used by the Copyright Office is a full text bibliographic database. There the author not
only selects the particular books to be included in the bibliography, he or she also writes their own
description as to each of the books. Since the author created the entire contents of the database,
both the selection and compilation aspect of the database, and the contents of the database, are
subject to copyright protection.

Even if the contents are raw facts, not new materials created by the author, the compilation
aspects of the database (selection, coordination and arrangement) may still receive copyright
protection. Copyright law prevents the copying of the coordination and arrangement of the facts,
the format of data presentation and manipulation, provided that the format and means are original.
This entails a consideration as to whether the coordination and arrangement are novel and unique,
or whether the arrangement itself contains information.

Not all compilations will meet the minimal originality standard. For example in the Feist
Publications case the Supreme Court held that the alphabetical arrangement of names in the
white pages was not entitled to copyright because: "there is nothing remotely creative about
arranging names alphabetically . . . It is not only unoriginal, it is practically inevitable." Feist
Publications, 499 U.S. at 363. This is similar to another copyright doctrine which is important to
computer law: "functionality," whereby an aspect of a computer program will not be protected by
copyright if it is merely utilitarian, rather than original. Lotus Development Corporation v.
Paperback Software International, 740 F.Supp. 37, 52-58, 68 (D.C. Mass. 1990) (Lotus 123
interface was an original expression entitled to copyright and was not merely a utilitarian function).

There are a number of other drawbacks and limitations to copyright protection. For instance, if
not properly perfected and registered a copyright can be waived and the work may enter the
public domain. Also, there are certain exceptions to copyright, such as exceptions based on the
"fair use" rule. L.Kutten, Computer Software, § 2.07(4)(c) and § 2.08A(2)(c)(iii), (1990); Dow
Jones & Co. v. Board of Trade of the City of Chicago, 546 F. Supp. 113 (S.D.N.Y. 1982); Telerate Systems, Inc. v. Caro, 689 F.Supp. 221 (S.D.N.Y. 1988); Campbell v. Acuff-Rose
Music, Inc., 510 U.S. _____, 127 L.Ed.2d. 500, 114 S.Ct. 1164 (1994).

Another drawback pertains to the deposit requirements of copyright registration. 37 C.F.R. §
202.20(C)(2)(vii). Printouts of the program source code and the database must be included with
the registration. If the program is IBM-PC or Apple Macintosh compatible, and is recorded on
CD-ROM or diskette, then under the Best Edition Statement supplement to the rules, you must
submit both the printout of the code and data and the software itself. There are however ways
around these deposit requirement by which you can protect the disclosure of trade secrets.

Another practical problem with the deposit requirement is that some databases are continually
changing and being updated, and thus the deposits and registrations must continue. Although
group registration on a quarterly basis is now permitted by the Copyright Office in certain
circumstances to try and obviate this problem, several technical problems with such periodic
group registrations remain.

Another drawback in relying on copyright protection alone is that your copyrights can be
weakened or waived if proper copyright procedures are not followed. Such procedures include
the proper fixation and display of copyright notices and the registration of the copyright with the
Copyright Office. The procedures and steps involved in registration of a computer database
copyright can be complicated and involved, particularly when trade secret information is involved.
L.Kutten, Computer Software, § 2.08A(4),(5),(6),(8), (1990). For this reason it is suggested
that the assistance of competent computer law counsel be retained to assist in this process.

With copyright law providing only limited protection to databases, and with all of the other
problems inherent in copyright protection of a database, contract and trade secret law become all
the more important to try and prevent the unauthorized copying of factual data in a database.

Adding trade secrecy protection to a database can provide significantly greater legal rights.
Consider for instance a case in Florida where the jury found that the defendant Florida Power and
Light Co. had stolen the plaintiff's trade secrets and awarded damages of $1.6 million. Florida
Power & Light v. Util. Services, 550 So. 2d 13 (Fla. 3rd DCA 1989). Under the state's civil
theft law, this award was then trebled, for a total judgment against the utility of $4.8 million.

Essentially a trade secret is knowledge which a person or company acquires through its own
efforts and which has some value to it. Typically, this knowledge is kept secret from competitors
because it is felt that this information provides some type of competitive advantage.

The Uniform Trade Secrets Act has now been enacted by most of the states in the country. Unif.
Trade Secrets Act, 14 U.L.A. 541 (1980). Section 1(4) of the Act defines a trade secret to
mean:

[I]nformation, including a formula, pattern, compilation, program, device, method,
technique or process that: (a) derives independent economic value, actual or potential, not
being generally known to, not being readily ascertainable by proper means by, other
persons who can obtain economic value from its disclosure or use; and (b) is the subject of
efforts that are reasonable under the circumstances to maintain its secrecy.

Since a computer database is a compilation which derives economic value, it is a type of
intellectual property which has frequently received trade secrecy protection. Whether or not a
court will find that a database is legally a trade secret frequently depends upon whether the
compiler made reasonable efforts to maintain its secrecy. Telerate Systems, Inc. v. Caro, 689
F.Supp. 221, 232 (S.D. N.Y. 1988) (Describes sufficient efforts taken to protect computer trade
secrets).

Many of the trade secret cases involve a dispute between an employer and former employee over
a compilation of data, namely a customer list. Customer List As a Trade Secret, 28 A.L.R.3d.
17. Many employers consider their customer list to be their most valuable trade secret. Thus,
when an employee leaves and takes the list with him to compete against an employer, a suit
frequently follows to have an injunction entered to make the employee return the list and not use
those trade secrets.

Information will be protected as a trade secret, even where there is no express contract requiring
non-disclosure of the information, where based upon the nature of the information and the
confidential relationship between the parties, such as employer- employee, equity should imply
such an agreement. Conversely, if parties have a written contract to treat certain information as a
trade secret, and not to disclose it, then even if the information does not legally qualify as a trade
secret, the parties may still be required to keep it secret. Without such an agreement, however,
the information in question must legally qualify as a trade secret to be entitled to protection.

When a database is licensed to others, and there is no confidential relationship, the data may still
have and retain a trade secrecy status, if it is sold with the express condition that the purchaser of
the database maintain the secrecy of theinformation.

A seller of the database can require that any purchaser enter into a written contract as a condition
of purchase of the database. Using our example, the purveyor of the computer lawyer database
could refuse to sell this information to anyone unless they first sign a written contract. That written
agreement could expressly provide that the purchaser will not disclose the list of computer lawyers
to anyone but authorized users, nor make any copies or unauthorized use of the information.
Typically this takes the form of a License Agreement between the preparer/licensor of the
database and the user/licensee of the database.

A License Agreement is unlike a typical purchase and sale agreement in that ownership of the
product involved, the program, remains in the licensor. The licensee merely purchases the right to
use the program. The licensee's right to use the program can be limited in any number of ways.
The most important limitations typically are that licensee can only use the program on one or a
select number of computers, the licensee may not make any copies of the program, and the
licensee has to keep confidential certain information about the program or the database. Many
other types of limitations or rights and reservations can be contained within the license agreement
between the parties.

Since the law and Courts in general are struggling to keep up with the rapid changes in
technology, a preparer of a database is well advised to try and strengthen his legal hand as much
as possible with certain practical protection measures. There are methods which a programmer
can employ to try and prevent someone from simply copying his work, or if they do, to make
proof of this copying in Court far easier. Without the conscious employment of these methods it
may be difficult to know whether or not a competitor has "cheated," and simply copied your
information, or has come up with the same information on his own.

The solution to this problem is the deliberate placement of errors or omissions in your database. If
your competitor's database contains the same errors or omissions, then you have pretty good
evidence that your database was copied. The odds are astronomical against a second database
happening to come up with the same errors and omissions as the first. So, for example, if you
deliberately use the wrong middle initial on a few of the computer lawyers and these same wrong
middle initials show up on a competitors database, then you have good proof that a competitor
did not independently derive the same information. He took yours.

The placement of deliberate errors and omissions in a program is known as the placement of
"seeds" into a database, or "salting" a database. SeeBusiness Guides, Inc. v. Chromatic
Communications Enterprises, Inc., 892 F.2d 802 (9th Cir., 1989) (interesting case which
concerns seeds and the fraudulent attempt of one database compiler to trick another into
repeating mistakes); Rockford Map Pub. v. Dir. Service Co. of Colorado, 768 F.2d 145, 147
(7th Cir., 1985) (Phony middle initials of names on a map spelled out Rockford Map Inc. when
read from top of the map to the bottom; copyright infringement found); Financial Information v.
Moody's Investors Service, 808 F.2d 204 (2d. Cir., 1986) (despite proof of copying by
repetition of false information planted in a bond database, no infringement was found because the
database required no originality or creativity. The database was therefore not protected by
copyright).

Although a clever "pirate" might detect and eliminate or correct some seeds in a salted database, if
the database is large enough and the original compiler/salter clever enough, it is unlikely that a
pirate will ever catch them all. These seeds will provide the best evidence of copying. They will
bloom at the time the pirate is sued and this evidence is placed before the Judge deciding the case.

Even if you do not deliberately salt your database, errors will occur naturally anyway if the
database is large enough. So in addition to deliberately adding some harmless errors, when and if
accidental errors are discovered, they should also be carefully documented or recorded. When
subsequent revised additions of the database are made, not all errors should be corrected. There
should always be subtle and harmless errors that are well documented in order to have the seeds
necessary to protect a database. Southwestern Bell Media v. Trans World Pub., Inc., 670
F.Supp. 899 (D.C. Kan. 1987) (Copying proven by showing that 29 out of 32 unintentional
errors contained in first telephone book were repeated in the second).

Errors or seeds in a database occur whether the database is manual or computerized. Any phone
book contains some errors in it which can be pointed to if a competing phone book should
attempt to copy the information, rather than develop it on its own. In computer databases,
however, there is an additional element which can be used to prove copying which I refer to as a
computer "signature." This signature pertains to the computer code or programming itself used to
record the information and the program which manipulates the information.

Thus, if someone simply copies a program the coding which embodies the program will sometimes
also be copied. A programmer naturally has a certain signature or style of his way of
programming. This is equivalent to a style of writing. Unlike writing novels, however, a
programmer has the opportunity to deliberately implant hidden but recognizable signatures in his
work. Thus, for instance, he could add unnecessary lines of code or encrypt messages in object
code that would be very difficult to detect. These deliberate idiosyncracies can be documented
and can again provide excellent proof that there has been a wholesale copying of the program.

The pirate can avoid signatures by having the database print out in hard copy form and then
re-entering the data into his own program from the hard copy. If, however, the pirate wants to
take the short cut of copying the program in electronic form, then he may fall victim to hidden
computer signatures. This is particularly true if the pirate not only steals the database but also
attempts to steal the program created to organize, manipulate and display the data.

Some database products consist only of the database itself and the user displays this database on
his own program. For instance, the names and addresses of computer lawyers could be typed in a
WordPerfect file. The purchasers of a database would thus have to use their own WordPerfect
program in order to view the information. In other types of database programs, the information is
sold along with a program which allows you to view and manipulate the data. In this case it is a
"stand alone" program which does not require another program to view it. So, instead of having to
load a list of the lawyers names and addresses into WordPerfect, under such a stand alone
program you would simply run the program and it would display the names and addresses by
itself.

When the database program is a stand alone type with its own display and manipulation
capabilities, then there are far more opportunities to place signatures in the programming itself.
Further, the copy protection strategy that is applicable to all types of software can apply. For
instance, the data or the program itself can be encrypted to make copying useless without the
decryption code or program.

Also, standard non-copying protection can be imposed upon the program itself. This makes it
difficult for most users to ever make a copy of the program. Still, as every computer buff knows,
for every good copy protection scheme there is another good "unprotection" scheme. In other
words, a skilled programmer can find a way around such practical copy protection schemes. The
ability of one programmer to rise to the technical competence of another, and frustrate such
practical protection schemes, makes legal protection all the more important.

Although copyright protection is important and should almost always be pursued, in any license of
a computer database of significant value, copyright protection alone should not be relied upon to
prohibit unauthorized copying. As the Feist case makes clear, copyright may not apply to protect
the data. Trade secrecy protection and an express written agreement between the vendor and
consumer are necessary to try and protect the database. If, as expected, information continues to
grow in value and importance as a commodity in our society, then the proliferation of license and
secrecy agreements is likely.

Now ready to check out the more colorful You Tube version of Database?

Recommended websites

E-discovery think-tank that Ralph Losey recommends as an important information resource for lawyers and IT.

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